Sometimes things go wrong, said Mark Rutte. And then? “Then it will be adjusted,” the outgoing prime minister continued. You could very much blame the person who made the mistake, hoping that a mistake would never be made again. Rutte did not want that, he said. “Unfortunately, we will never reach that Valhalla. But there is no reason to believe that someone here has tried to do something crazy, right?”
Rutte was not talking about the Dutch who were crushed under the wheels of the Tax Authorities, the UWV or another government agency this century. With his words, Rutte did not stand up for the people who had been crushed by the government.
He stood up for the government that was crushing the people. For the work of politicians and civil servants, and more precisely, for the tough fraud law that the Rutte I cabinet had drawn up and came into effect from 2013, during the second Rutte cabinet.
It was his second appearance before the parliamentary inquiry committee that investigated the derailed fraud policy. And just like the first time, a month ago, Rutte was adamant.
‘Thirteen years of continuing’
The fraud law appeared to plunge innocent citizens into great misery. Those who did not follow the rules were punished disproportionately. Yet Rutte refused to blame the legislature for this, even after the judge struck down the fraud law at the end of 2014. “So that’s where it works feedback loopbecause it will be adjusted again in a year and a half,” said Rutte. “Isn’t that how the system works?”
If the five weeks of hearings during the parliamentary inquiry have shown anything, it is this: the stark contrast between compassion for the legislator and the executor and toughness for the citizen who, often alone and often above average vulnerable, had to stand up to the powerful state to withdraw. One was allowed to make mistakes, the other was not. One gained confidence, the other distrust.
That’s how it went with the Fraud Act, and that’s how it went now with the benefits department of the Tax Authorities. As early as 2008, the parents and the owner of a childcare agency that facilitated childcare said in the interrogations, letters from the Tax Authorities were received stating suspicions of fraud and requiring large amounts to be reclaimed. That went on for years.
Rutte, who had commented on the fraud law that it had been ‘solved’ in a year and a half, also found it “unbelievable” how the horrors surrounding the childcare allowance had lasted “thirteen years.” [konden] carry on.” It is a scandal about which he is “full of shame”, he has said before.
But it was no surprise that he went to great lengths to defend ‘the system’. After all, the entire approach to fraud bore the fingerprints of Mark Rutte: as State Secretary for Social Affairs in Balkenende I and II, as VVD leader who led the way with his party in addressing and prioritizing the fight against fraud in coalition agreements and as Prime Minister for thirteen years, and so on. also as leader of a ministerial committee that increased this fight to an even higher volume.
Viewed in this way, the work of the committee of inquiry – the final report is expected after the turn of the year – is also a settlement with a dominant image of how people work and what the state is capable of for years. A political faith that wanted to focus on the self-reliance of citizens, with a small and efficient government that took a step back to make this possible, but which precisely because of this lost sight of the citizen. This belief was supported much more widely than just in the VVD.
In that system, people could be ground up without being noticed, all based on the idea that malicious people were eating away at the treasury and support for social services with their abuse. Cheap turned out to be expensive. The Bulgarian fraud, one of the most exposed fraud cases, cost the government 4 million euros. Compensation for the Benefits Scandal will cost 7.1 billion euros in the latest interim reports.
Hammer looking for nail
How can a system that was based on solidarity and trust – the social safety net of social assistance and other benefits, and later the benefits that millions of households received – turn into a system that is essentially based on distrust of the citizen?
The most striking answer to that question was formulated by civil servant Rob Krug. “I think there was this general psychological phenomenon that if you have a hammer, you see nails everywhere,” Krug said. “In other words, if you are an investigating officer, you see offenders everywhere. You don’t meet people who don’t break the law. So you don’t have that 90% in the picture.”
As a civil servant, Krug had been involved in the preparation for the fraud law under VVD member Henk Kamp at the Ministry of Social Affairs. Kamp, himself a former investigator for the FIOD, immediately said upon arrival that he did not believe any of the percentages that Krug and his officials showed him. “Because in his experience it was very different,” says Krug.
Kamp was not the first to want to work on combating fraud. As State Secretary at the same ministry between 2002 and 2004, Rutte had also focused on making the approach to fraud more stringent. That was “logical”, he said in the first week of interrogation, even though the evidence for major or increased fraud was often “anecdotal”. His predecessors had set the tone, Rutte declared, and that included PvdA members. The hammers were on the rise. And they saw nails everywhere.
Showpiece
The fraud law became the concrete expression of this distrust, a showpiece of Kamp. From now on, people were punished much more severely if they did not fully report their information, while that information – such as the number of hours they worked – was constantly changing. The law increased the maximum fine to 100 percent of the amount wrongly paid.
Not only that: the explanatory memorandum to the law prohibited virtually any way to deviate from that maximum fine.
Something different was going on with the allowances. The introduction of that system in 2005 was accompanied by a naive idea. People had to report their financial situation in advance and were paid money as an advance. Here too, it often involved a lot of information, which could change enormously. That could lead to significant refunds and problems.
Moreover, the Tax Authorities were unable to check applications in advance at all. This encouraged both actual abuse and accidents involving benefits. Especially in the case of childcare allowance, where the amounts are the highest (especially for parents with low incomes, who receive more allowance) and where the use of childminders, in addition to regular childcare, has led to a proliferation of new mediation agencies. Sometimes fraudulent, often not.
Officials had pointed out the “serious design errors” in the allowance, Sander Veldhuizen, head of department at Social Affairs, told the committee in an interview. But nothing changed in the system. Proposals to pay childcare institutions directly were advanced. In the meantime, parents were tackled immediately if the Tax Authorities suspected them of an incorrect application.
Powerless politicians
It is a fact that incidents like the Bulgarian fraud fueled the fire. Then there were even more hammers, there seemed to be even more nails and the approach to fraud was tightened. The creation of the CAF teams, who hunted benefits fraud like ‘cowboys’, is a product of this.
This also applied to the Tax Authorities’ risk classification model, which was deployed within two weeks of the first reports of the Bulgarian fraud, after one long weekend of development and without a test phase. Those who emerged in that system were checked more quickly.
Yet the interrogations show how often a completely different factor is decisive: carelessness. There was almost always something that caused the suffering to fade into the background.
Take PvdA member Diederik Samsom, who headed a cabinet with Rutte in 2012. That was the cabinet that actually introduced the fraud law, Samsom’s party colleague Lodewijk Asscher was responsible for it. According to Samsom, his party saw from afar that things would go wrong, and it was not without reason that the PvdA had voted against the fraud law in the House of Representatives. “We predicted that things would go wrong, but by definition the empirical evidence could only follow after January 1, 2013.”
Only: the law had been passed and already signed up as an austerity measure. “Of course he went along with the flow, just as a lot goes with the flow once you have made an agreement.” This was simply a VVD wish, just like the increase in the maximum speed to 130 km per hour.
Asscher, in turn, stayed away from the file for a long time. And when the fraud law was cracked by the judge, he did not want to reverse the 65,000 fines that had already been imposed. After conversations with his officials, he said, he feared that would set a precedent for other laws.
Excavation work
Here it was not hype, but carelessness that ruled. Errors could serve as evidence of fraud without substantiation. Discussions about privacy were brushed aside. Data with a limited purpose ended up in completely different places within the Tax Authorities, without the necessary context.
The interrogation of whistleblower Pierre Niessen proved that such a system does not have to be a straightjacket. And there were politicians who did it differently. MPs such as Pieter Heerma, Sadet Karabulut (SP) and Steven van Weyenberg (D66) asked questions about the fraud law. Later, Pieter Omtzigt (then CDA, now NSC), Renske Leijten (SP) and Farid Azarkan (Denk) did a lot of digging into the allowances.
Yet after the 43 hearings by the committee, a different sound remains. That is that of the government as a juggernaut, unaware of its own powers, which can pulverize the citizen. The sound of a hammer striking down.
A version of this article also appeared in the October 7, 2023 newspaper.